February brings chill to U.S. retail sales
NEW YORK, Mar 2 (Reuters) February brought a chill to U.S. retailers, which had stocked up with spring merchandise to catch shoppers wielding gift cards but had little to offer in the way of winter coats when the weather turned cold.
Retailer Children's Place Retail Stores Inc. also noted that the later Easter holiday hurt sales as consumers held off buying dressy outfits.
Apparel retailer Talbots Inc. said its February sales at stores open at least a year dropped 6 per cent in February, missing Wall Street's expectation that the company report flat sales.
''Our total February comparable store sales results were significantly impacted by the major snowstorm that swept across much of the country in the middle of the month,'' Chairman, President and Chief Executive Arnold Zetcher said in a statement.
Snow, ice, below-zero temperatures and biting winds across the East and South resulted in February being colder than January for the first time since 1989, according to weather research and analysis firm Planalytics. The average January temperature was 45.3 degrees, while February's average shuddered in at 38.8 degrees, Planalytics said.
In January, retailers had posted better-than-expected sales as shoppers redeemed gift cards to buy discounted winter gear and early spring fashions in one of the warmest Januarys on record.
Teen retailer Aeropostale Inc. reported a 5.4 per cent decrease in sales at stores open at least a year on weaker-than-expected traffic, surprising analysts, who had expected the company to report a gain of 4 per cent.
Wal-Mart Stores Inc. said again it saw February sales that rose 3.2 per cent at its U.S. stores, in the middle of its forecast. The home goods and apparel retailer said it expects U.S. March comp-store sales between 1 per cent and 3 per cent.
Earlier this month, Wal-Mart rival Target Corp. lowered the high end of its February forecast, blaming a massive winter snowstorm that covered much of the U.S. Northeast the weekend before Valentine's Day.
Target said it expects an increase of 2.5 per cent to 3.5 per cent at its stores open at least a year, down from its original forecast for as much as 4.5 per cent growth.
Children's Place, a retailer of children's clothes that bought the Disney stores in November 2004, said sales rose 1 per cent, as strong demand at its Disney stores made up for a decline at its namesake chain. Same-store sales were down 2 per cent at Children's Place stores, which the retailer blamed on Easter falling on April 16, later in the calendar this year.
Last year, the holiday fell in March.
Family Dollar Stores Inc. said comparable store rose 4.4 per cent and said that April results will be about 2 per cent to 4 per cent higher due to the later Easter.
Some analysts have said retail stocks are expensive relative to their risk. The Standard&Poor's retail index is trading at a 6 per cent premium to the S&P 500 multiple, excluding Wal-Mart, higher than the five-year average multiple of 0.98 times earnings, according to Bernstein Research.
REUTERS SD RN1906